Introduction
One shareholder is required for the incorporation and continued existence of a Cyprus private company. The nationality of the shareholders is immaterial. Apart from the shareholder, a Cyprus company should have at least one director and one corporate secretary. The Cyprus Companies Law, Cap 113, as amended, allows for single member companies i.e. shareholder, director and corporate secretary being the same person. However, many investors choose to use nominee services i.e. using a licensed accounting or legal firm, to act on their behalf and/or hold the shares on their behalf.
Principle of Trust
The trust relationship is recognised under Cypriot law, both by statute and in equity. The principles of equity which apply under English law are applicable in Cyprus as provided by the Courts of Justice Law, 1960.
The security documentation of the beneficial owner (according to the practice followed by professional firms) comprise the following:
- the trust deed;
- the original share certificates which are issued in the names of the nominee shareholders;
- instruments of transfer of shares executed in blank;
- directors’ resolutions approving the transfer of shares (where nominee directors are appointed);
- undated letters of resignation of the nominee directors;
- irrevocable dividend mandates for payment of dividends to the beneficial owners or to an account designated by them.